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Consistent with this trend, more companies have turned to Web-based IT management software and shifted the burden of maintaining the tool back to the vendor and shifted the cost structure from a capital expenditure to a simple, per-seat operating expense.

IT service management (ITSM) software has proved a good fit for the Software as a Service (SaaS) model. The technology startup Service-now.com's SaaS-based ITSM tool taking the Gold Award in SearchDataCenter.com's 2009 Products of the Year in the Systems Management category. The company has taken some business from the Big Four: BMC Software Inc., CA, IBM and Hewlett-Packard Co., all of which have tried to get their foot in the SaaS door without cannibalizing sales of their on-premise systems management software.

One IT manager in county government uses Service-now.com's ITSM and said the Web-based delivery model is a huge plus. Previously the county used BMC Service Desk, but 18 months ago his organizaiton's IT department merged with another organization. Now, instead of maintaining two separate ticketing systems, his shop switched to Service-Now.com.

The Big Four systems management vendors have tried to get their foot in the SaaS door without cannibalizing their on-premise software.,

"I think BMC could have success using the Web-based model; this is the new wave," said the former BMC customer. "But I think there is more to the success of Service-now than just the unique delivery model. Service-now has developed a very customizable product. In my experience with other products, they were limited in customization."

BMC said IT managers have turned to SaaS as an alternative delivery model to reduce administration cost and improve efficiency of their IT organizations. "We expect that ITSM applications have similar potential to transition to SaaS as what we have seen with CRM [customer relationship management] applications," said Paul Avenant, BMC's vice president of products.

On the process side of ITSM, SaaS offerings just makes sense, said RedMonk analyst Michael Coté. "Managing [IT management software] installs on your own can start to becoming a mounting hassle themselves, and scaling them up can be a hassle as well. Customers should expect less hassle with the same features, and a cheaper TCO," Coté said. "It'll be interesting to see how BMC handles the customizations and extensions that customers have done into their ITSM portfolios, and moving from classical enterprise pricing to SaaS pricing can be rough going. BMC's done it before with their Magic and Patrol Express offerings, though."

So too, the BMC SaaS-based ITSM offering has a few things going for it. The Web-based BMC ITSM tool, for example, natively integrates with the BMC Atrium Configuration Management Database (CMDB), giving IT managers a single view into technology components. Many enterprise data center managers will also feel more comfortable buying from a large vendor.

BMC expects to launch three releases a year. Customers will be able to opt in or out of upgrades, enabling IT managers to migrate to the next version on their own schedule.

None of the Big Four has forsaken SaaS. HP has offered its Peregrine IT asset management tool via SaaS subscription for a year and IBM in November released Tivoli Live, which puts together some IT services and management into a SaaS subscription.

Gartner Inc. estimates that over the next three years, 15% to 25% of ITSM software customers will adopt an on-demand solution in their data center.

What did you think of this feature? Write to SearchDataCenter.com's Matt Stansberry about your data center concerns at mstansberry@techtarget.com.

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